Bruce E Ruben Md Pc v. Allstate Insurance Company
326717
| Mich. Ct. App. | Oct 11, 2016Background
- Brian Badgett, an Allstate insured pedestrian injured in 1990, received long‑term treatment from Dr. Bruce Ruben; parties previously entered a consent final judgment setting rates for disputed medical items using jury values and Ingenix 85th‑percentile rates, and providing for arbitration with an express no‑appeal clause.
- A dispute arose over the proper Ingenix value for the drug Tygacil (Ruben billed at 2008/2009 Ingenix rates; Allstate paid a much lower rate), leading the parties to privately arbitrate the dispute (not AAA).
- The arbitration panel (2–1) awarded Ruben approximately $4.34M (amended to $4.64M), applying the Ingenix values despite Allstate’s claim of a manual mistake.
- Allstate moved to vacate the arbitration award in circuit court; Ruben moved to confirm and separately moved for relief from the final judgment’s no‑appeal provision so he could appeal the court’s vacation of the award.
- The trial court vacated the arbitration award and granted Ruben relief from the no‑appeal clause under MCR 2.612(C)(1)(f); the Court of Appeals vacated only the portion granting relief from the no‑appeal provision and remanded.
Issues
| Issue | Plaintiff's Argument (Ruben) | Defendant's Argument (Allstate) | Held |
|---|---|---|---|
| Whether trial court properly granted relief from the consent judgment’s no‑appeal clause under MCR 2.612(C)(1)(f) | Court should allow relief because the court misapplied MCR 3.602 in vacating the arbitration award and the matter implicates public concern | The no‑appeal clause is a freely negotiated, enforceable term of the consent judgment; relief would harm Allstate’s substantial rights and no extraordinary circumstances exist | The Court of Appeals held the trial court abused its discretion in granting relief; vacated that portion of the order and remanded |
| Whether the reason for setting aside judgment fit within subsections (a)–(e) of MCR 2.612(C)(1) | Relief was justified for other reasons (subsection (f)) | The ground asserted does not fall under (a)–(e) but other requirements must be met for (f) | Court accepted that the asserted reason didn’t fit (a)–(e), but ruled other (f) prerequisites failed |
| Whether granting relief would detrimentally affect Allstate’s substantial rights | The no‑appeal provision could be set aside without harming Allstate | Enforcing consent judgments as contracts protects Allstate’s substantial rights; vacatur would impair contractual enforcement | Court found Allstate’s substantial rights would be detrimentally affected |
| Whether extraordinary circumstances exist to justify relief under (f) | Misapplication of MCR 3.602 by the trial court is an extraordinary circumstance warranting relief | Extraordinary circumstances ordinarily involve improper conduct; mere legal error does not suffice | Court held no extraordinary circumstances existed to satisfy (f) |
Key Cases Cited
- Peterson v. Auto Owners Ins. Co., 274 Mich. App. 407 (standards for reviewing MCR 2.612 decisions)
- Heugel v. Heugel, 237 Mich. App. 471 (requirements for relief under MCR 2.612(C)(1)(f))
- Rose v. Rose, 289 Mich. App. 45 (construction and enforcement of unambiguous consent judgments/contracts)
- Laffin v. Laffin, 280 Mich. App. 513 (consent judgments construed as contracts; relief affects substantial rights)
- King v. McPherson Hosp., 290 Mich. App. 299 (application of MCR 2.612(C)(1)(f) framework)